Astec cuts 2026 EBITDA guidance despite record Q2 sales
Astec Industries lowered its full-year earnings guidance on Wednesday due to delayed asphalt plant orders stemming from federal funding uncertainty, even as record second-quarter sales and a surging backlog highlight robust underlying demand.
Astec Industries posted record second-quarter revenue and adjusted EBITDA but slashed its full-year earnings guidance on Wednesday as political uncertainty delays equipment deliveries. The company now expects 2026 adjusted EBITDA of $160 million to $175 million, down from a prior range of $170 million to $190 million.
The quarterly results easily surpassed prior-year figures. Net sales rose 23.6% to $408.1 million, while adjusted EBITDA climbed 26% to $42.6 million. Adjusted EBITDA margins expanded by 20 basis points to 10.4%, and adjusted earnings per share reached $0.94, up from $0.90 a year earlier.
The guidance reduction reflects a shift in timing rather than a collapse in demand. Chief Executive Officer Jaco van der Merwe noted that higher oil prices and uncertainty surrounding the renewal of the Federal Highway Bill have prompted select asphalt plant customers to push deliveries into the fourth quarter of 2026 and the first quarter of 2027.
Despite this near-term disruption, the company's order book signals sustained momentum. Backlog surged 57.9% to $601.1 million, driven primarily by a 150.6% increase in the Material Solutions segment. Implied orders grew 49.1% year-over-year to $460 million. Van der Merwe attributed the Material Solutions strength to healthy dealer inventories and a global mining sector poised for significant investment driven by electrification and data center construction.
Legislative headwinds appear temporary. The current infrastructure law expires in September 2026, and a continuing resolution is expected before its proposed successor takes effect. While the BUILD America 250 Act carries a smaller headline figure of $580 billion, Astec highlighted that core highway funding would actually rise 7% to $376 billion, with guaranteed formula funding increasing from 87% to 90%.
"A longer-term bill is a matter of when, not if," van der Merwe said, noting the legislation provides a baseline for hitting the company's 2030 financial targets. Elsewhere, parts and service revenue grew 34.8% to $135.5 million, representing 33.2% of net sales. The company also recently launched eight new equipment models at the Hillhead 2026 exhibition in the U.K. to capitalize on international growth.
